[Sys1]

I think the first reason why we will fall off the undulating plateau is the lack of investments made since the oil price crash of 2014.
Global economy is not really recovering, it is artificially helped by central banks which printed money for almost 10 years while technology companies (Amazon, Uber, Ebay, Air bn be...) basically act like parasites on real economy, creating virtual growth (stock) at the expense of jobs and production of goods.
So as a slow growing demand still exists, the need for oil gradually moves north, a bit like water getting hot for the frog cooked alive in the famous story we all know.
My pronostic is that we will wake up one day witnessing oil is now too expensive to have the time left to shift to renewable energies (which is by the way actually impossible without drastically change our non negociable way of life) or to invest in shale or whatever crappy fossil fuels left on this planet.

What will be more interesting is that as oil will get very expensive soon, central banks which already play a game with a credit rate pretty close to 0% won't have any bullet left in their barrel to shoot at inflation with.
My scenario :
1) oil is getting too expensive (+100$), economy slows down, "experts" don't get why
2) central banks low back their rate because the focus is not yet on oil prices, but on the worry about this slowing economy
3) energy and food inflation kicks in + jobs cut while dow jones getting higher
4) oil is getting more expensive (we fall off the plateau, so even with lower demand, oil offer still collapses)
5) dow jones getting higher faster and faster (bubble tech and real estate) BUT central banks become afraid about energy and food inflation : riots, political problems...
6) central banks lift their rate to calm down oil prices
7) which trigger a new collapse of real estate, this time far worse than 2008. In a terminal hurry, investors shift to oil and gold...
8 ) Oil prices skyrocket.
9) Central banks don't know what to do. Game Over.

We are heading right to hell. We are stucked in this plateau since 2008. 2008 was the first step of the global collapse of civilisation. The second step is described above. Enjoy.

[asg70]

$this->bbcode_second_pass_quote('Sys1', '
')1) oil is getting too expensive (+100$), economy slows down, "experts" don't get why
2) central banks low back their rate because the focus is not yet on oil prices, but on the worry about this slowing economy
3) energy and food inflation kicks in + jobs cut while dow jones getting higher
4) oil is getting more expensive (we fall off the plateau, so even with lower demand, oil offer still collapses)
5) dow jones getting higher faster and faster (bubble tech and real estate) BUT central banks become afraid about energy and food inflation : riots, political problems...
6) central banks lift their rate to calm down oil prices
7) which trigger a new collapse of real estate, this time far worse than 2008. In a terminal hurry, investors shift to oil and gold...
8 ) Oil prices skyrocket.
9) Central banks don't know what to do. Game Over.

[ROCKMAN]

OK, time once again to be my pissy self. Before we can "fall off" an undulating plateau we have to be on an UP...which we aren't. Yes, global oil production has become somewhat static to a slight decline lately. But that's been artificial and not natural.

But even that is insignificant compared to the DECADES LONG trend of INCREASING GLOBAL OIL PRODUCTION. Am I the only one that pulls up production charts. There a variety out there and none show an UP:

http://peakoilbarrel.com/wp-content/upl ... World1.jpg

Next problem I have: so when we do reach a prolonged UP of global oil production define what a "fall off" !looks like. That terms implies a relatively rapid decline. But quantity it: 10%/yr, 20%/yr, 30%/yr, more? Compare to the US during pre-shale days:

https://en.m.wikipedia.org/wiki/Oil_dep ... _Curve.png

On an UP from 1968 to 1986. Then declined from 9 mm bopd to 5 mm bopd from 1986 to 2006: a 45% decline over 20 years. IOW significantly less the 10% per year. Does that qualify as "falling off"? I let everyone qualify it themselves. And do we expect global oil production to decline faster then what the US experienced? Slower? And why regardless of what you predict?

[KaiserJeep]

I say the undulations will continue for 2-5 decades.

This will not be a comfortable period for anybody employed, unemployed, or retired - because as energy gets more expensive, so does everything else produced or transported with FF's. During this period, currency will inflate considerably, impoverishing those who try to exist on fixed incomes - soon to include me. Meanwhile, the 3rd World will starve.

The second half of the Peak Oil curve COULD last for another century of gradual power-down, if nobody panics, and nobody tries to take more than their share. It will last less than half as long as it could, because people are apes, acting as apes act.

https://www.youtube.com/watch?v=yLu9FaZTE-Y

[vtsnowedin]

So Rockman is your prediction that total world production will keep rising for the foreseeable future?
The decline in the US production in the seventies was counter balanced by increases in other countries which were cheaper then continued efforts in the US. What happens when there are no more cheaper sites to exploit anywhere in the world? Even a five percent per year world decline would leave a lot of demand unmet and cause major changes in how we use oil. Burn it just to heat a building? not very likely.

[Tanada]

$this->bbcode_second_pass_quote('ROCKMAN', 'O')K, time once again to be my pissy self. Before we can "fall off" an undulating plateau we have to be on an UP...which we aren't. Yes, global oil production has become somewhat static to a slight decline lately. But that's been artificial and not natural.

But even that is insignificant compared to the DECADES LONG trend of INCREASING GLOBAL OIL PRODUCTION. Am I the only one that pulls up production charts. There a variety out there and none show an UP:




Next problem I have: so when we do reach a prolonged UP of global oil production define what a "fall off" !looks like. That terms implies a relatively rapid decline. But quantity it: 10%/yr, 20%/yr, 30%/yr, more? Compare to the US during pre-shale days:

On an UP from 1968 to 1986. Then declined from 9 mm bopd to 5 mm bopd from 1986 to 2006: a 45% decline over 20 years. IOW significantly less the 10% per year. Does that qualify as "falling off"? I let everyone qualify it themselves. And do we expect global oil production to decline faster then what the US experienced? Slower? And why regardless of what you predict?

[ROCKMAN]

vt - "So Rockman is your prediction that total world production will keep rising for the foreseeable future?" I didn't predict anything. Just pointed the statistical FACT that global oil production has not reached an undulating plateau phase...yet. So before we predict when we fall off (which I've seen no one offer a metric to quantify) of an UP we might wait until we spend some time on an UP. In the meantime for those who think they are smart enough: when does global oil production reach the UP phase and how long does it hold there?

[ROCKMAN]

T - Much thanks for that colorful chart...it proves my point. From 2005 to today global oil production has yet to reach the undulating plateau phase: it has consistently reached a new peak production for more then a decade. And while there have been dips in the rate it has not only recovered but increased. In the undulating plateau phase I would expect those peaks to hold around the same volume, wouldn't you?

In fact, even your dips in production since 2010 have shown progressively higher values. High peaks and higher lows over time do not define an undulating plateau IMHO.

Now that we've settled that do you want to predict when we'll reach the UP phase and how long we might hold there? After that we can discuss exactly what "falling off" the plateau looks like.

[ralfy]

We can also look at oil production per capita.

[dirtyharry]

$this->bbcode_second_pass_quote('ROCKMAN', 'T') - Much thanks for that colorful chart...it proves my point. From 2005 to today global oil production has yet to reach the undulating plateau phase: it has consistently reached a new peak production for more then a decade. And while there have been dips in the rate it has not only recovered but increased. In the undulating plateau phase I would expect those peaks to hold around the same volume, wouldn't you?

In fact, even your dips in production since 2010 have shown progressively higher values. High peaks and higher lows over time do not define an undulating plateau IMHO.

Now that we've settled that do you want to predict when we'll reach the UP phase and how long we might hold there? After that we can discuss exactly what "falling off" the plateau looks like.

[onlooker]

20101111-world-energy-outlook-peak-oil.jpg

Yes ample amount of info via charts, statistics etc. do show as dirtyharry says a peak in conventional Oil around 2005-6
Notice also in the chart-graph, I include how oil sources yet to be found and yet to be developed also are showing a downturn.

[asg70]

I remember that chart and how much mockery was heaped upon it back in the day. Now produce an updated chart from 2017.

If there's anything peak oilers should have realized by now is that you can't just look at a chart from 5+ years ago and assume that where we are now is where it projected us to be.

[onlooker]

Ash, I am not sure why in regards to the dating you voice objection since it is showing something that happened a number of years back in 2005-6. So it is NOT a prediction but an accounting of what has already happened

[ROCKMAN]

Hey guys: oil from shales, oil from tar sands, oil bleeding from my ass: it's all oil. And US consumers don't consume oil...they consume refinery products. And the stuff used to produce those refinery products has not reached a plateau yet. Probably soon IMHO...but not yet.

So stop f*cking around and answer the critical question: what does "falling off" the plateau look Luke in numerical terns.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('ROCKMAN', 'H')ey guys: oil from shales, oil from tar sands, oil bleeding from my ass: it's all oil. And US consumers don't consume oil...they consume refinery products. And the stuff used to produce those refinery products has not reached a plateau yet. Probably soon IMHO...but not yet.

So stop f*cking around and answer the critical question: what does "falling off" the plateau look Luke in numerical terns.

[asg70]

$this->bbcode_second_pass_quote('Outcast_Searcher', '
')I'm rooting for buying 5 to 7 decades from shale fracking and natural gas

[Tanada]

I see it the same way I have always seen it. Shale is great, while it lasts. On the other hand shale has so far proven to be limited to only certain formations at certain depths where fracking is both technically and economically viable. Natural Gas shale resources seem to be vast and on a scale only dreamed of a few decades ago for Natural Gas resource potential. Shale oil that can be economically recovered appears to be on a vastly more limited scale and extent than the lighter hydrocarbons including the 'wet' natural gas with a large percentage of Ethane/Propane/Butane in its mixture.

There were a lot of potential shale formations suitable for oil extraction that real world development proved to either be very low recovery rates, or just plain improbable in usefulness. Just for example the Monterrey Shale formation in California was downgraded 96% in its potential before the glut and crash of 2015. The shale wells in Poland and the UK are additional examples of places where the potential was believed to exist and test wells were drilled but results were mediocre at best and completely uneconomic even at $100/bbl at worst.

ROCKMAN himself has posted many times on this very website about how shale formations are extremely common but shale formations that can be fracked to produce liquid hydrocarbons at a profit are rare. A handful of formations have produced nearly all of the fracked liquid hydrocarbons produced in the USA to date even though hundreds of formations had test wells poked in the ground and fracked only to deliver no economically viable oil even though prices were in the $80-$115/bbl band for over four years while those test wells were completed.

I freely admit I fell for the red Queen theory that depletion rates in fracked wells would remain steep in the tail period of production and their lifespan as stripper wells would be very short. This as the saying goes, turned out not to be the case. Fracked wells producing like strippers do decline faster than traditional stripper wells, but they still operate for at least a decade in many cases. Of course some of them deplete to nothing quickly and on the other end of the average some will stay strippers for several decades. The simple fact is the fracking for liquid hydrocarbons in shale boom took off in 2009 though there were some earlier wells. By boom I mean every wildcatter and his brother was taking a shot at shale fracking as a get rich quick system in 2009-2014 causing many thousands of wells to be drilled fracked and completed in those five years. The boom caused a glut and forced down the price enough to slash drilling and fracking rates to a very low number in early 2016, but that number recovered substantially by the end of 2016 and has continued to slowly grown throughout 2017 to date.

But that doesn;t change a couple significant facts about liquid hydrocarbons from shale. First, the number of formations that are economic as well as technically viable is a limited number of the world total volume of shale formations. Something like 1%-3% of the world shale beds are potential liquid hydrocarbon sources at $80/bbl. Yes that adds up to a lot of oil, but it is not an unlimited resource or one that is going to flow glut like volumes for 5 to 7 decades into the future. EIA which is hardly a pessimistic organization projected that shale oil production in the USA would peak between 2018-2022 at the drilling rates experienced in 2013. Drilling rates in 2014 greatly exceeded those 2013 rates topping out around 1600 active drilling rigs. This week Baker Hughes says the USA is back up to 909 active rigs closing on on the 1300 that were active at the beginning of 2013. Add in the improvement in technique that all those fracked wells have taught the remaining companies how to implement and the productivity per rig is much better than it was in 2013-2014. That isn't to say the rig count is unimportant, just that the productivity of 909 rigs in October 2017 is more than the same 909 rigs in 2013-2014.

However you want to slice it we are operating 56% of the peak rig number from 2014 today and that is up from about 30% of the 2014 number a year ago. Unless those ETP psychics are right and the price crashes to some very low number very soon and stays there forever the number of working rigs is going to keep rising. If it keeps rising like it has for the last 12 months for another year we will be back to 75% perhaps 80% of the peak working rig rate by this time next year.

In June 2015 we hit 9.61 MM/bbl/d USA crude production and today we are back up to 9.51 MM/bbl/d even though active rigs is still lower than it was in late 2014. I honestly don't know what legacy oil fields that were tapped out and already went through secondary and tertiary recovery might be eligible for fracking as a Quaternary recovery technique. If I understood ROCKMANS's many posts on the topic it is one of the things he has specialized in, reworking tired old fields with new methods to squeeze more petroleum out and sell. Maybe the KSA can use fracking and long laterals to get another 250 G/bbl out of Gahwar, but for now at least they are not doing that and expecting it to happen is pure speculation. Even if KSA does deploy Fracking with all the bells and whistles to squeeze another trillion barrels out of OPEC fields that isn't going to alter the fact that China is now producing close to twice as many new cars for their own population every year as the USA both builds and imports from overseas. That is not going to change any time soon and with each passing year it means China has a greater import demand for crude oil and refined products. China is not quite literally the worlds biggest oil importer and even at a modest growth rate they are doing an excellent job of putting an end to the glut, with India not that far behind them on the import growth curve.

Yes the graph I posted from Pops shows a bumpy situation with LTO from USA Fracking growing on top of all other sources. The whole point of the bumpy plateau is to notice that while world oil supplies grew rapidly in the 1990's and up until about 2002 the growth has been very small in the last decade and a half with the sole exception of USA LTO production. Unless you honestly believe LTO can grow and keep growing for several decades into the future you should find the lack of growth in other oil sources troubling. I certainly do.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('asg70', '')$this->bbcode_second_pass_quote('Outcast_Searcher', '
')I'm rooting for buying 5 to 7 decades from shale fracking and natural gas

[dirtyharry]

$this->bbcode_second_pass_quote('ROCKMAN', 'H')ey guys: oil from shales, oil from tar sands, oil bleeding from my ass: it's all oil. And US consumers don't consume oil...they consume refinery products. And the stuff used to produce those refinery products has not reached a plateau yet. Probably soon IMHO...but not yet.

So stop f*cking around and answer the critical question: what does "falling off" the plateau look Luke in numerical terns.

[dirtyharry]

$this->bbcode_second_pass_quote('ROCKMAN', 'H')ey guys: oil from shales, oil from tar sands, oil bleeding from my ass: it's all oil. And US consumers don't consume oil...they consume refinery products. And the stuff used to produce those refinery products has not reached a plateau yet. Probably soon IMHO...but not yet.

So stop f*cking around and answer the critical question: what does "falling off" the plateau look Luke in numerical terns.